Magnificent 7 Oscillator

// This Pine Script® code is subject to the terms of the Mozilla Public License 2.0 at https://mozilla.org/MPL/2.0/
// © [Your Username]

//@version=6
indicator("Magnificent 7 Oscillator", shorttitle="MAG7", overlay=false, precision=2, max_lines_count=500)

// =====================================================
// SCIENTIFIC BASIS AND LITERATURE REFERENCES
// =====================================================
// This oscillator is based on momentum analysis and relative performance studies:
// - Jegadeesh & Titman (1993): "Returns to Buying Winners and Selling Losers"
// - Carhart (1997): "On Persistence in Mutual Fund Performance" (Momentum Factor)
// - Fama & French (2015): "A Five-Factor Asset Pricing Model"
//
// The Magnificent 7 stocks (AAPL, MSFT, GOOGL, AMZN, NVDA, TSLA, META) represent
// a significant portion of market capitalization and often lead market trends.
// This oscillator analyzes their momentum relative to broader market indices.

// =====================================================
// INPUT PARAMETERS
// =====================================================

// Core Parameters
momentum_length = input.int(14, "Momentum Period", minval=5, maxval=100, 
                           tooltip="Lookback period for momentum calculation (Jegadeesh & Titman used 3-12 months)", 
                           group="Core Parameters")
smoothing_length = input.int(5, "Smoothing Period", minval=1, maxval=50, 
                           tooltip="Moving average smoothing for noise reduction", 
                           group="Core Parameters")

// Signal Thresholds
bullish_threshold = input.float(2.0, "Bullish Threshold (%)", minval=0.1, maxval=10.0, step=0.1, 
                               tooltip="Threshold for bullish momentum signals", group="Core Parameters")
bearish_threshold = input.float(-2.0, "Bearish Threshold (%)", maxval=-0.1, minval=-10.0, step=0.1, 
                               tooltip="Threshold for bearish momentum signals", group="Core Parameters")

// Divergence Analysis
divergence_threshold = input.float(1.0, "Divergence Threshold (%)", minval=0.1, maxval=5.0, step=0.1, 
                                 tooltip="Threshold for relative performance divergence", group="Core Parameters")

// Stock Selection (Magnificent 7 + Additional)
ticker1 = input.string("AAPL", "Stock 1", group="Stock Selection", tooltip="Apple Inc.")
ticker2 = input.string("MSFT", "Stock 2", group="Stock Selection", tooltip="Microsoft Corporation")
ticker3 = input.string("GOOGL", "Stock 3", group="Stock Selection", tooltip="Alphabet Inc.")
ticker4 = input.string("AMZN", "Stock 4", group="Stock Selection", tooltip="Amazon.com Inc.")
ticker5 = input.string("NVDA", "Stock 5", group="Stock Selection", tooltip="NVIDIA Corporation")
ticker6 = input.string("TSLA", "Stock 6", group="Stock Selection", tooltip="Tesla Inc.")
ticker7 = input.string("META", "Stock 7", group="Stock Selection", tooltip="Meta Platforms Inc.")
ticker8 = input.string("", "Additional Stock 1", group="Stock Selection", tooltip="Optional additional stock")
ticker9 = input.string("", "Additional Stock 2", group="Stock Selection", tooltip="Optional additional stock")

// Weighting Method
equal_weight = input.bool(true, "Equal Weight Calculation", group="Stock Selection", 
                         tooltip="Equal weight vs market cap weighted (when available)")

// Oscillator Mode Selection
oscillator_mode = input.string("Magnificent 7", "Oscillator Mode", 
                              options=["Magnificent 7", "S&P 500 EW", "Relative Performance"], 
                              group="Oscillator Settings",
                              tooltip="Magnificent 7 = MAG7 momentum | S&P 500 EW = Equal weight momentum | Relative Performance = MAG7 vs S&P 500 EW")

// S&P 500 Equal Weight Reference
sp500_ew_ticker = input.string("RSP", "S&P 500 EW Ticker", group="Oscillator Settings",
                              tooltip="S&P 500 Equal Weight ETF (RSP) or Index (SPXEW)")

// =====================================================
// OSCILLATOR TYPE SELECTION
// =====================================================

oscillator_type = input.string("Momentum", "Oscillator Type", 
                               options=["Momentum", "RSI", "Stochastic", "Williams %R", "CCI"], 
                               group="Oscillator Settings",
                               tooltip="Momentum = Price rate of change | RSI = Relative Strength Index | Stochastic = %K oscillator | Williams %R = Larry Williams' %R | CCI = Commodity Channel Index")

// =====================================================
// DISPLAY OPTIONS
// =====================================================
show_table = input.bool(true, "Show Data Table", group="Display")
show_signals = input.bool(true, "Show Trading Signals", group="Display") 
show_background = input.bool(true, "Show Background Colors", group="Display")

// =====================================================
// APPEARANCE SETTINGS
// =====================================================
use_dark_mode = input.bool(true, "Dark Mode", group="Appearance", 
                          tooltip="Optimized for dark backgrounds")

// Color Configuration
neutral_color = use_dark_mode ? #2196F3 : #1976D2  // Material Blue
bullish_color = use_dark_mode ? #4CAF50 : #388E3C  // Material Green
bearish_color = use_dark_mode ? #FF5252 : #D32F2F  // Material Red

// Custom Color Override
enable_custom_colors = input.bool(false, "Custom Colors", group="Appearance")
custom_neutral = input.color(#2196F3, "Neutral", group="Appearance", inline="colors")
custom_bullish = input.color(#4CAF50, "Bullish", group="Appearance", inline="colors") 
custom_bearish = input.color(#FF5252, "Bearish", group="Appearance", inline="colors")

// Apply color selection
final_neutral_color = enable_custom_colors ? custom_neutral : neutral_color
final_bullish_color = enable_custom_colors ? custom_bullish : bullish_color
final_bearish_color = enable_custom_colors ? custom_bearish : bearish_color

// Visual Settings
background_transparency = use_dark_mode ? 85 : 92
zone_transparency = use_dark_mode ? 90 : 95
table_transparency = use_dark_mode ? 80 : 15

// Line Configuration
main_line_width = input.int(2, "Main Line Width", minval=1, maxval=5, group="Line Styles")
threshold_line_width = input.int(1, "Threshold Line Width", minval=1, maxval=3, group="Line Styles")

// =====================================================
// DATA COLLECTION AND MOMENTUM CALCULATION
// =====================================================

// Momentum calculation function with error handling
get_momentum(symbol) =>
    if symbol != ""
        current_price = request.security(symbol, timeframe.period, close, ignore_invalid_symbol=true)
        historical_price = request.security(symbol, timeframe.period, close[momentum_length], ignore_invalid_symbol=true)
        
        // Calculate momentum as percentage change
        if not na(current_price) and not na(historical_price) and historical_price != 0
            momentum = ((current_price - historical_price) / historical_price) * 100
            momentum
        else
            0.0
    else
        0.0

// Calculate momentum for all tickers
momentum1 = get_momentum(ticker1)
momentum2 = get_momentum(ticker2)
momentum3 = get_momentum(ticker3)
momentum4 = get_momentum(ticker4)
momentum5 = get_momentum(ticker5)
momentum6 = get_momentum(ticker6)
momentum7 = get_momentum(ticker7)
momentum8 = get_momentum(ticker8)
momentum9 = get_momentum(ticker9)

// Count active tickers for proper averaging
active_count = (ticker1 != "" ? 1 : 0) + (ticker2 != "" ? 1 : 0) + (ticker3 != "" ? 1 : 0) + 
               (ticker4 != "" ? 1 : 0) + (ticker5 != "" ? 1 : 0) + (ticker6 != "" ? 1 : 0) + 
               (ticker7 != "" ? 1 : 0) + (ticker8 != "" ? 1 : 0) + (ticker9 != "" ? 1 : 0)

// Calculate S&P 500 Equal Weight momentum for comparison
sp500_ew_momentum = if oscillator_mode == "S&P 500 EW" or oscillator_mode == "Relative Performance"
    get_momentum(sp500_ew_ticker)
else
    0.0

// =====================================================
// COMPOSITE OSCILLATOR CALCULATION
// =====================================================

// Calculate raw composite momentum
raw_oscillator = if equal_weight and active_count > 0
    // Equal weight calculation (Fama-French factor construction method)
    total_momentum = momentum1 + momentum2 + momentum3 + momentum4 + momentum5 + momentum6 + momentum7 + momentum8 + momentum9
    total_momentum / active_count
else
    // Market cap weighting could be implemented here for future enhancement
    total_momentum = momentum1 + momentum2 + momentum3 + momentum4 + momentum5 + momentum6 + momentum7 + momentum8 + momentum9
    active_count > 0 ? total_momentum / active_count : 0.0

// =====================================================
// OSCILLATOR TRANSFORMATION FUNCTIONS
// =====================================================

// Transform raw momentum into different oscillator types
transform_oscillator(raw_value) =>
    smoothed_value = ta.sma(raw_value, smoothing_length)
    
    if oscillator_type == "Momentum"
        // Simple momentum oscillator (Jegadeesh & Titman methodology)
        smoothed_value
        
    else if oscillator_type == "RSI"
        // RSI transformation (Wilder's Relative Strength Index)
        // Convert momentum to RSI-like scale (0-100)
        rsi_source = smoothed_value + 50  // Shift to positive values
        ta.rsi(rsi_source, 14) - 50  // Center around 0
        
    else if oscillator_type == "Stochastic"
        // Stochastic oscillator (%K methodology by George Lane)
        lookback_period = momentum_length
        highest_value = ta.highest(smoothed_value, lookback_period)
        lowest_value = ta.lowest(smoothed_value, lookback_period)
        range_value = highest_value - lowest_value
        
        if range_value != 0
            stoch_k = ((smoothed_value - lowest_value) / range_value) * 100
            stoch_k - 50  // Center around 0
        else
            0.0
            
    else if oscillator_type == "Williams %R"
        // Williams %R (Larry Williams' %R)
        lookback_period = momentum_length
        highest_value = ta.highest(smoothed_value, lookback_period)
        lowest_value = ta.lowest(smoothed_value, lookback_period)
        range_value = highest_value - lowest_value
        
        if range_value != 0
            williams_r = ((highest_value - smoothed_value) / range_value) * 100
            williams_r - 50  // Center around 0
        else
            0.0
            
    else if oscillator_type == "CCI"
        // Commodity Channel Index (Donald Lambert)
        typical_price = smoothed_value
        sma_tp = ta.sma(typical_price, 20)
        mean_deviation = ta.sma(math.abs(typical_price - sma_tp), 20)
        
        if mean_deviation != 0
            cci = (typical_price - sma_tp) / (0.015 * mean_deviation)
            cci / 5  // Scale down for better visualization
        else
            0.0
    else
        smoothed_value

// =====================================================
// MODE-SPECIFIC CALCULATIONS
// =====================================================

// Calculate oscillators for different modes
mag7_oscillator = transform_oscillator(raw_oscillator)
sp500_ew_oscillator = transform_oscillator(sp500_ew_momentum)
relative_performance_oscillator = mag7_oscillator - sp500_ew_oscillator

// Select current oscillator based on mode
current_oscillator = if oscillator_mode == "Magnificent 7"
    mag7_oscillator
else if oscillator_mode == "S&P 500 EW"  
    sp500_ew_oscillator
else  // Relative Performance
    relative_performance_oscillator

// =====================================================
// SIGNAL GENERATION
// =====================================================

// Generate trading signals based on thresholds
is_bullish = current_oscillator > bullish_threshold
is_bearish = current_oscillator < bearish_threshold
is_neutral = not is_bullish and not is_bearish

// Signal triggers
buy_signal = ta.crossover(current_oscillator, bullish_threshold)
sell_signal = ta.crossunder(current_oscillator, bearish_threshold)

// Relative performance crossover calculations (must be calculated on every bar)
div_outperform_cross = ta.crossover(current_oscillator, divergence_threshold)
div_underperform_cross = ta.crossunder(current_oscillator, -divergence_threshold)

// Apply mode condition to relative performance signals
div_outperform_signal = oscillator_mode == "Relative Performance" and div_outperform_cross
div_underperform_signal = oscillator_mode == "Relative Performance" and div_underperform_cross

// =====================================================
// BREADTH ANALYSIS
// =====================================================

// Calculate breadth metrics (percentage of stocks with positive momentum)
bullish_count = (momentum1 > 0 ? 1 : 0) + (momentum2 > 0 ? 1 : 0) + (momentum3 > 0 ? 1 : 0) + 
                 (momentum4 > 0 ? 1 : 0) + (momentum5 > 0 ? 1 : 0) + (momentum6 > 0 ? 1 : 0) + 
                 (momentum7 > 0 ? 1 : 0) + (momentum8 > 0 ? 1 : 0) + (momentum9 > 0 ? 1 : 0)

breadth_percentage = active_count > 0 ? (bullish_count / active_count) * 100 : 0

// =====================================================
// DYNAMIC COLOR CALCULATION
// =====================================================

// Calculate line color based on oscillator value and mode
oscillator_color = if is_bullish
    final_bullish_color
else if is_bearish
    final_bearish_color
else
    final_neutral_color

// Background color with gradient effect
bg_color = if is_bullish
    color.new(final_bullish_color, background_transparency)
else if is_bearish
    color.new(final_bearish_color, background_transparency)
else
    color.new(final_neutral_color, background_transparency + 5)

// =====================================================
// PLOTTING AND VISUALIZATION
// =====================================================

// Main oscillator plot
plot(current_oscillator, title="Oscillator", color=oscillator_color, linewidth=main_line_width)

// Zero line
zero_line_plot = plot(0, title="Zero Line", color=color.new(color.gray, 30), linewidth=threshold_line_width)

// Dynamic threshold lines based on oscillator mode
plot(oscillator_mode == "Magnificent 7" ? bullish_threshold : na, 
     title="MAG7 Bullish Threshold", color=color.new(final_bullish_color, zone_transparency), 
     linewidth=threshold_line_width, style=plot.style_line)
plot(oscillator_mode == "Magnificent 7" ? bearish_threshold : na, 
     title="MAG7 Bearish Threshold", color=color.new(final_bearish_color, zone_transparency), 
     linewidth=threshold_line_width, style=plot.style_line)

plot(oscillator_mode == "S&P 500 EW" ? bullish_threshold : na, 
     title="S&P500 EW Bullish Threshold", color=color.new(final_bullish_color, zone_transparency), 
     linewidth=threshold_line_width, style=plot.style_line)
plot(oscillator_mode == "S&P 500 EW" ? bearish_threshold : na, 
     title="S&P500 EW Bearish Threshold", color=color.new(final_bearish_color, zone_transparency), 
     linewidth=threshold_line_width, style=plot.style_line)

plot(oscillator_mode == "Relative Performance" ? divergence_threshold : na, 
     title="Relative Performance Upper Threshold", color=color.new(final_bullish_color, zone_transparency), 
     linewidth=threshold_line_width, style=plot.style_line)
plot(oscillator_mode == "Relative Performance" ? -divergence_threshold : na, 
     title="Relative Performance Lower Threshold", color=color.new(final_bearish_color, zone_transparency), 
     linewidth=threshold_line_width, style=plot.style_line)

// Background shading
bgcolor(show_background ? bg_color : na, title="Oscillator Background")

// =====================================================
// PROFESSIONAL DATA TABLE
// =====================================================

if show_table and barstate.islast
    // Theme-adaptive table
    table_bg_color = use_dark_mode ? color.new(#000000, table_transparency) : color.new(#FFFFFF, table_transparency)
    var table oscillator_table = table.new(position.top_right, 2, 9, border_width=1, bgcolor=table_bg_color)
    
    table.clear(oscillator_table, 0, 0)
    
    // Header
    header_text_color = use_dark_mode ? color.white : color.black
    table.cell(oscillator_table, 0, 0, "MAG7 Oscillator", text_color=header_text_color, bgcolor=table_bg_color, text_size=size.normal)
    table.cell(oscillator_table, 1, 0, "Values", text_color=header_text_color, bgcolor=table_bg_color, text_size=size.normal)
    
    // Core metrics
    label_text_color = use_dark_mode ? color.white : color.black
    
    table.cell(oscillator_table, 0, 1, "Value", text_color=label_text_color, bgcolor=table_bg_color, text_size=size.small)
    table.cell(oscillator_table, 1, 1, str.tostring(current_oscillator, "#.##") + "%", text_color=oscillator_color, bgcolor=table_bg_color, text_size=size.small)
    
    // Mode
    mode_display = oscillator_mode == "Magnificent 7" ? "MAG7" : 
                   oscillator_mode == "S&P 500 EW" ? "S&P EW" : "Relative"
    table.cell(oscillator_table, 0, 2, "Mode", text_color=label_text_color, bgcolor=table_bg_color, text_size=size.small)
    table.cell(oscillator_table, 1, 2, mode_display, text_color=final_neutral_color, bgcolor=table_bg_color, text_size=size.small)
    
    // Status
    status_text = oscillator_mode == "Relative Performance" ? 
                  (is_bullish ? "OUTPERFORM" : is_bearish ? "UNDERPERFORM" : "NEUTRAL") :
                  (is_bullish ? "BULLISH" : is_bearish ? "BEARISH" : "NEUTRAL")
    table.cell(oscillator_table, 0, 3, "Signal", text_color=label_text_color, bgcolor=table_bg_color, text_size=size.small)
    table.cell(oscillator_table, 1, 3, status_text, text_color=oscillator_color, bgcolor=table_bg_color, text_size=size.small)
    
    // Oscillator type
    type_display = oscillator_type
    table.cell(oscillator_table, 0, 4, "Type", text_color=label_text_color, bgcolor=table_bg_color, text_size=size.small)
    table.cell(oscillator_table, 1, 4, type_display, text_color=label_text_color, bgcolor=table_bg_color, text_size=size.small)
    
    // Component details for relative performance mode
    if oscillator_mode == "Relative Performance"
        mag7_color = mag7_oscillator > 0 ? final_bullish_color : final_bearish_color
        table.cell(oscillator_table, 0, 5, "MAG7", text_color=label_text_color, bgcolor=table_bg_color, text_size=size.small)
        table.cell(oscillator_table, 1, 5, str.tostring(mag7_oscillator, "#.##") + "%", text_color=mag7_color, bgcolor=table_bg_color, text_size=size.small)
        
        sp500_color = sp500_ew_oscillator > 0 ? final_bullish_color : final_bearish_color
        table.cell(oscillator_table, 0, 6, "S&P EW", text_color=label_text_color, bgcolor=table_bg_color, text_size=size.small)
        table.cell(oscillator_table, 1, 6, str.tostring(sp500_ew_oscillator, "#.##") + "%", text_color=sp500_color, bgcolor=table_bg_color, text_size=size.small)
    
    // Breadth analysis (using pre-calculated values)
    breadth_color = breadth_percentage > 60 ? final_bullish_color : 
                     breadth_percentage < 40 ? final_bearish_color : final_neutral_color
    
    table.cell(oscillator_table, 0, 7, "Breadth", text_color=label_text_color, bgcolor=table_bg_color, text_size=size.small)
    table.cell(oscillator_table, 1, 7, str.tostring(breadth_percentage, "#") + "%", text_color=breadth_color, bgcolor=table_bg_color, text_size=size.small)
    
    // Threshold information
    threshold_display = oscillator_mode == "Relative Performance" ? 
                       "±" + str.tostring(divergence_threshold, "#.#") + "%" :
                       "±" + str.tostring(math.abs(bullish_threshold), "#.#") + "%"
    table.cell(oscillator_table, 0, 8, "Threshold", text_color=label_text_color, bgcolor=table_bg_color, text_size=size.small)
    table.cell(oscillator_table, 1, 8, threshold_display, text_color=label_text_color, bgcolor=table_bg_color, text_size=size.small)

// =====================================================
// ALERT CONDITIONS
// =====================================================

// Mode-specific alerts for trading systems
alertcondition(oscillator_mode == "Magnificent 7" and buy_signal, 
               title="MAG7 Bullish Signal", 
               message="Magnificent 7 Oscillator: Bullish momentum signal triggered")
               
alertcondition(oscillator_mode == "Magnificent 7" and sell_signal, 
               title="MAG7 Bearish Signal", 
               message="Magnificent 7 Oscillator: Bearish momentum signal triggered")

alertcondition(oscillator_mode == "S&P 500 EW" and buy_signal, 
               title="S&P 500 EW Bullish Signal", 
               message="S&P 500 Equal Weight: Bullish momentum signal triggered")
               
alertcondition(oscillator_mode == "S&P 500 EW" and sell_signal, 
               title="S&P 500 EW Bearish Signal", 
               message="S&P 500 Equal Weight: Bearish momentum signal triggered")

alertcondition(oscillator_mode == "Relative Performance" and div_outperform_signal, 
               title="MAG7 Outperformance Signal", 
               message="Magnificent 7 vs S&P 500 EW: Relative outperformance detected")
               
alertcondition(oscillator_mode == "Relative Performance" and div_underperform_signal, 
               title="MAG7 Underperformance Signal", 
               message="Magnificent 7 vs S&P 500 EW: Relative underperformance detected")

// Zero line crosses for momentum shifts
alertcondition(ta.cross(current_oscillator, 0), 
               title="Momentum Shift", 
               message="Oscillator crossed zero line - momentum direction change")

// =====================================================
// PERFORMANCE METRICS (Hidden Plots for Backtesting)
// =====================================================

// Individual stock momentum (for strategy development)
plot(momentum1, title="Stock 1 Momentum", display=display.none)
plot(momentum2, title="Stock 2 Momentum", display=display.none)
plot(momentum3, title="Stock 3 Momentum", display=display.none)
plot(momentum4, title="Stock 4 Momentum", display=display.none)
plot(momentum5, title="Stock 5 Momentum", display=display.none)
plot(momentum6, title="Stock 6 Momentum", display=display.none)
plot(momentum7, title="Stock 7 Momentum", display=display.none)

// Composite metrics
plot(breadth_percentage, title="Bullish Breadth Percentage", display=display.none)
plot(sp500_ew_momentum, title="S&P 500 EW Momentum", display=display.none)
plot(relative_performance_oscillator, title="Relative Performance", display=display.none)

// =====================================================
// INTERPRETATION GUIDE
// =====================================================
//
// OSCILLATOR MODES:
// 1. Magnificent 7: Tracks momentum of the seven largest tech stocks
// 2. S&P 500 EW: Tracks momentum of equal-weighted S&P 500 index
// 3. Relative Performance: MAG7 momentum relative to S&P 500 EW
//
// OSCILLATOR TYPES:
// - Momentum: Simple rate of change (Jegadeesh & Titman methodology)
// - RSI: Relative Strength Index transformation
// - Stochastic: %K oscillator (George Lane)
// - Williams %R: Larry Williams' %R
// - CCI: Commodity Channel Index (Donald Lambert)
//
// SIGNAL INTERPRETATION:
// - Bullish: Oscillator above upper threshold (strong momentum)
// - Bearish: Oscillator below lower threshold (weak momentum)  
// - Neutral: Oscillator between thresholds (sideways momentum)
//
// RELATIVE PERFORMANCE MODE:
// - Positive values: MAG7 outperforming S&P 500 EW
// - Negative values: MAG7 underperforming S&P 500 EW
// - Used for sector rotation and style analysis
//
// BREADTH ANALYSIS:
// - >60%: Strong breadth (most stocks positive)
// - <40%: Weak breadth (most stocks negative)
// - 40-60%: Mixed/neutral breadth
//
// ACADEMIC REFERENCES:
// - Jegadeesh, N., & Titman, S. (1993). Returns to buying winners and selling losers
// - Carhart, M. M. (1997). On persistence in mutual fund performance
// - Fama, E. F., & French, K. R. (2015). A five-factor asset pricing model